When Facebook, Inc. (NASDAQ:FB) debuted in May 2012 at around $42.00 a share, much of the talk circulated around the absence of profits and a clear vision by founder and CEO Mark Zuckerberg. Could the company’s staggering user base of more than one billion unique members be turned into a profitable formula for owners of FB stock?

Facebook had its rough moments early on, even falling to the $17.00 level in September 201,2 as traders debated how to price FB stock. In the world of hindsight investing, it was an opportune buying opportunity for those who realized the company had an amazing asset: two billion eyeballs.

Fast-forward three years or so and Facebook has transformed into a bellwether stock for the Internet social media space. The company leads the industry, while nearly every other social media stock, including Twitter, Inc. (NASDAQ:TWTR), struggles to find its niche. It’s unclear now, but Twitter could be undergoing some temporary issues. TWTR stock could easily vault if CEO Jack Dorsey can grow the company’s stalled user base, monetize assets, and inject a little more excitement into investors. He’s got his work cut out for him.

Why Facebook Is the Face of the Internet

Imagine Mark Zuckerberg when he was at Harvard and attempting to develop a social platform where people could connect. Obviously, it required a simple idea, but a bigger vision and lots of innovation. This is exactly what has propelled FB stock above $100.00 a share and a market value in excess of $302 billion.

While the ascension in the company’s share price has been superlative, I believe there is much more room to grow, albeit the company will face hurdles along the way.

Consider that Facebook is still shut out of China, the world’s biggest Internet market. While strict freedom of expression laws are the norm in China, a breakthrough into the Chinese market could be a major game-changer for Facebook, allowing the company’s share price to catapult higher. This would allow the company to greatly increase its user base and the Internet space rewards companies for user growth. That’s why companies like Facebook and Netflix, Inc. (NASDAQ:NFLX) are rewarded, but Twitter appears to be banished, at least for the time being.

Considering its valuation, Facebook is not excessive at 37-times (X) its 2016 earnings and it has a relatively reasonable price-to-earnings growth (PEG) ratio of 1.66. Paying only 1.66X the estimated five-year CAGR for earnings is definitely attractive.

Consider this: revenues are slated to grow 39.9% to $17.43 billion this year, followed by another 37.9% to $24.03 billion in 2016, according to Thomson Financial. That’s pretty big growth and considering these numbers, I repeat, the company’s current valuation is rather reasonable.

However, what is perhaps most exciting is the company’s success to monetize its user base and drive revenues in the highly competitive mobile advertising space. In the third quarter, the key mobile advertising area generated about 78% of the company’s total advertising revenue, up from 66% a year earlier and 49% in 3Q14. Facebook’s strategy is clearly working.

The Bottom Line on FB Stock

Over 1.01 billion people used Facebook on a daily basis in September. Of this, 894 million were mobile users. The number surges to 1.55 billion based on monthly active users in September, with mobile at an astounding 1.39 billion users.

Make no mistake about it: Facebook is the top social media stock in the world. I can see the market value eventually eclipsing a trillion dollars somewhere down the road, especially if it can break past the Great Wall of China.